020516 Fast Food Hurts as U.S. Eats More at Home

Chicago - Fast-food giants McDonald's Corp. and Burger King are losing favor with U.S. consumers, as the sluggish economy has reversed gains in eating out and forced shoppers back into the kitchen, a new study found.

"More consumers are inclined to prepare home-cooked meals, with fast-food restaurants losing significant ground as a source of take-out food," grocery trade group Food Marketing Institute said in its latest report on food buying habits.

Early this year, the number of consumers preparing home-cooked meals at least three times a week had jumped to 85 percent from 74 percent in the same period in 2001. Those eating fast food once or more a week fell to 32 percent from 38 percent. Take-out and home-delivery meals also posted declines, FMI said.

Safety concerns following the tragic events of Sept. 11 may have fueled the back-at-home trend, but consumers had started to pinch pennies before the attacks on the United States, FMI said in its study, "Trends in the United States: Consumer Attitudes & the Supermarket, 2002."

Beginning in the fourth quarter of 2001, consumers began to pare their spending habits. By January, when the unemployment rate reached 5.6 percent, well above its average of 4.8 percent in 2001, food budgets came down to levels seen two years ago, FMI said.

The typical U.S. household in January spent about $85 a week on groceries, down from $91 in 2001. Consumers put more of their food budgets toward less-expensive, private-label brands like Safeway Inc.'s Safeway Select and Albertson's Inc. President's Choice lines, and used frequent shopper programs to save money.

The importance of low-priced foods jumped 7 points, to 84 percent, tying for the No. 3 most-important feature sought in supermarkets along with high-quality meats, behind cleanliness and high-quality produce, FMI said.

FMI, which released its study during the start of its annual trade show in Chicago, based its study on a phone poll with about 2,000 consumers.

CONVENIENCE, NUTRITION TOP DRIVERS

Economics may be the dominant factor sending consumers back to their own kitchens, but the nutritional concerns of graying baby boomers are another driver, FMI said.

"It is possible that consumers may be turning away from the major fast-food chains owing to a perception that the chains are a less healthy alternative and/or consumers are simply bored with them," the FMI report noted.

Indeed, almost half of all shoppers said that fat content is what concerns them most about the nutritional contents of the foods they eat.

Despite the move toward home cooking, convenience remained the rallying cry of shoppers. Nearly half the meals cooked in American homes each week were prepared in 30 minutes or less, as consumers gravitated toward pre-packaged meal kits and precooked foods such as ready-to-heat pot roasts and other meats, FMI said.

Those too busy to sit down for breakfast turned toward grab-and-go choices such as yogurt in tubes and cereal bars. Some parents began putting premade frozen sandwiches in lunch boxes.

More one-stop shopping services, such as on-site gas pumps, self-scanning at check-out counters, and expanded pharmacies, helped draw shoppers back to grocery stores, FMI said.

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